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To buy, renovate, or build your next home?

To buy, renovate, or build your next home?

Published Fri 3 May 2024 • 6 min read

Buying vs renovating vs building. It's the age-old debate facing homeowners. And there's no magic answer — your goals, lifestyle and financial situation will influence your decision. Here are some common factors to consider when deciding which path to take.


Finding a ready-made solution

You can skip the stress and expense of building or renovating by instead buying. You can tailor your hunt to prices, suburbs and features you want from a home, plus a loan suiting your needs.

The challenge though could be you may need to compromise on certain areas during the process of buying a house, which could mean eventual renovations — which could defeat the purpose of buying to begin with.


Your home is likely the biggest financial decision you’ll make. It pays to plan ahead before you jump in. If having kids is a future dream, will your home have enough space? Will you need a backyard? Do your suburb’s facilities meet your lifestyle or are there plans to build them?

Looking ahead can ensure your dream home stays that way for decades and generations.


Buying a home, unfortunately, also means a bunch of fees you’ll need to budget for. Stamp duty is the biggest cost on top of your purchase price and can cost tens of thousands. Would you rather invest that sum in renovating your current property?

Find out how much you could borrow. In only two minutes you could have an obligation-free indication of your borrowing power.
Start your application online or call us on 1800 100 258, 8am-8pm Mon-Fri and 9am-5pm Sat (AEST/AEDT).


Consider your location

A change of scenery can be revitalising and exciting!

The good news with home renovation plans is you're in control of how you go about it. You could choose improvements with a smaller upfront cost — like repainting — or invest in kitchen and bathroom upgrades.

If you choose renovation, just be mindful of overcapitalising. That’s where the cost of renovations exceeds the value they add to your home. For example, if you spend $50,000 updating your kitchen and bathroom, only to learn through a later valuation your home increased by $40,000, you’ve essentially lost $10,000.

And remember, even the best renovation won’t compensate for a poor location or an unappealing aspect.

Be realistic about what can be achieved with home improvements

Check your proposed improvements are okay with the local council.

More importantly, speak with an architect or licensed builder to discover whether your home is structurally sound enough to handle your proposed works. Older homes, in particular, can present hidden nasties like dodgy wiring, uneven floorboards, and unidentified termite damage that can quickly blow out your renovation budget.

Time spent researching key issues will go a long way to ensuring you make the right choice today and further down the track.

It's all about timing

If you plan, you could avoid peak seasons for services. For example, if you look at installing cooling solutions in winter, you'll have more freedom and availability in finding services than in summer when demand is red-hot.

If you're looking at an apartment renovation, you'll need to factor in body corporate and neighbours — and approvals may take longer than you hope.

Crunch the numbers

Your budget plays a big role in choosing between moving and improving. High property transaction costs — plus the time and commitment involved in the process of buying a house — means it can often be easier and cheaper to renovate than sell up and move to a new home.

In particular, stamp duty on the new place can cost tens of thousands of dollars. Stamp duty gives you no direct benefit, but the sum involved could pay for a new kitchen or bathroom.

Add up moving costs and see how they stack against a major home improvement. You could discover renovating is the better value option.


You're in control

A home build means you can create a home the way you want, pending approval that is. This includes land size and layout, which is a significant difference compared to buying.

Being in control, however, also means responsibility in managing the build on top of everything else in your life. Ensure you can handle the stress and time before you buy.

Council approval

While building gives you the freedom to dream, you also need your council to sign off on your ideas. Council approval can be a lengthy, expensive and legal process. Hiring a professional town planner can make life easier but comes with costs.

The waiting game

While watching your home plans become a reality is thrilling, it doesn’t happen overnight. Delays also happen, including material and labour shortages. You’ll need to consider accommodation in the interim.

Find out how much you could borrow. In only two minutes you could have an obligation-free indication of your borrowing power.
Start your application online or call us on 1800 100 258, 8am-8pm Mon-Fri and 9am-5pm Sat (AEST/AEDT).